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Town Sports Chapter 11 plan of reorganization confirmed by court
By Sarah Lizee
Olympia, Wash., Dec. 21 – Town Sports International, LLC’s Chapter 11 plan of reorganization was confirmed Friday by the U.S. Bankruptcy Court for the District of Delaware.
The plan provides the vesting of all available cash from the proceeds of a sale transaction of the post-effective date debtors for the purpose of distribution to holders of claims, as previously reported.
It also provides for full resolution of funded debt obligations and designates a plan administrator to wind down the debtors’ affairs and pay and reconcile claims.
Under the plan, holders of secured tax claims will receive payment in full in cash on the effective date or in full with interest on semiannual dates for five years after the effective date.
Holders of other secured claims will receive payment in full in cash, receive the collateral securing their claims, have their claims reinstated or receive other treatment that renders the claim unimpaired.
Holders of other priority claims will receive payment in full in cash.
Holders of pre-petition loan claims will receive their pro rata share of the excess distributable cash in line with a distribution waterfall.
Holders of general unsecured claims will receive their pro rata share of non-released claims trust interests.
Holders of intercompany claims will not receive any distribution.
Intercompany interests will be either reinstated or discharged with no distribution, at the debtors’ option.
Section 510(b) claims and interests in Town Sports International will be canceled with no distribution.
Town Sports is a Jupiter, Fla.-based owner and operator of fitness clubs. The company filed bankruptcy on Sept. 14 under Chapter 11 case number 20-12168.
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